Bitcoin
Head of crypto asset manager Grayscale Investments steps down
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Michael Sonnenshein has stepped down as chief executive of Grayscale Investments, after more than a decade helping establish the US group as one of the world’s largest cryptocurrency asset managers.
He will be replaced by Peter Mintzberg, global head of strategy for asset and wealth management at Goldman Sachs, in August.
Sonnenshein joined Shades of gray in 2014 to help build its bitcoin investment fund and had been chief executive since 2021. He was leaving to “pursue other interests,” the group said in a statement.
His departure comes as Grayscale faces fierce competition to dominate the emerging market for stock market-listed funds that invest directly in Bitcoin.
Grayscale won a crucial court victory last year that set the stage for the Securities and Exchange Commission to approve the spot exchange traded funds in January, after years of rejections.
The approval also allowed Grayscale to convert its bitcoin fund into an ETF, but its initial advantage, when it had $28 billion in assets under management, has slowly been whittled away. Rivals such as Fidelity, Ark and BlackRock have undercut their rivals’ fees, and Grayscale’s 1.5% charge is the highest in the market.
Holders of the Grayscale ETF have withdrawn more than $17 billion since January, and assets under management have fallen to about $19.4 billion, according to Morningstar. Since then, BlackRock’s bitcoin ETF has grown to $18.4 billion.
“By successfully winning a lawsuit, the company created a rapidly growing ETF market segment,” said Todd Rosenbluth, head of research at consultancy VettaFi. “However, stiff competition from some of the largest asset managers, such as BlackRock and Fidelity, has eroded Grayscale’s asset leadership.”
The New York group said Edward McGee, chief financial officer, would lead the company until Mintzberg’s Aug. 15 launch.
“Peter is an exceptional strategic leader with global experience across the most prominent asset managers, which are critical ingredients as we position Grayscale for its next phase of growth,” said Barry Silbert, chief executive of Digital Currency Group, owner of Grayscale. He was unavailable for an interview Monday.
“This is an exciting time in Grayscale’s history as it continues to capitalize on unprecedented momentum in the asset class,” Mintzberg said in a statement.
Sonnenshein said in a LinkedIn post that he was leaving “with deep gratitude for everyone who has been on this incredible rocket journey” and was “excited for what’s next.”
Grayscale also manages a $9 billion Ethereum fund and is one of several asset managers looking to launch an Ethereum ETF. The SEC faces deadlines this week to decide whether to approve two of these Ethereum ETF applications.